Linking Anticipatory Action to Risk Financing: Compendium of Think Pieces by Members of the Sectoral Community

Over the past decades, a suite of new Climate and Disaster Risk Finance and Insurance (CDRFI) tools has been generated across the development, the humanitarian and the private sector. Examples include index-based insurance, catastrophe bonds, forecast-based financing, pooled funds and many other innovations. Unfortunately, these innovative instruments have often been implemented largely in isolation of each other. Most of them are not integrated in comprehensive disaster risk financing strategies or linked more systematically to recent humanitarian efforts to scale anticipatory action (AA). They all serve different purposes, address different target groups and are based on different modalities – which has its advantages but also results in untapped potential, a loss of synergies, and risks leaving behind those who need the financing the most.

In March 2021, the Anticipation Hub, the InsuResilience Global Partnership (IGP) and the Risk-Informed Early Action Partnership (REAP) teamed up to launch the “Sectoral Community on Linking Anticipatory Action to Risk Financing”. The objective of the Sectoral Community (SC) is to bring together the development & humanitarian sector, public & private actors, civil society actors, researchers and think tanks to exchange experiences and share ideas on how various CDRFI tools and anticipatory action can be better integrated.

To deepen the discussions, the SC members came up with the idea to draft ‘think pieces’ – succinct, policy-relevant opinion pieces in which SC members could advocate for a particular position or objectively describe the issue/challenges and possible opportunities, options and solutions at hand. SC members developed a set of 10 questions, and they were then invited to address those questions based on their experience, technical expertise and further research. The think pieces are not necessarily providing the views of the organisations of the respective authors but their personal perspective. About every 4-6 weeks the SC gathered over the course of 2022 to discuss and refine the ideas coming out of the think pieces.